Earnest continues to monitor consumer behavior as state economies reopen across the country. In this refresh, we look at state performance in the context of stay-at-home orders expiring, foot traffic divergences across categories, a Texas drill-down, and how spending by channel is behaving in a staggered reopened economy.
Missed our first piece on how consumers are responding? Read it here.
- Total consumer spending growth improved to 15% YoY declines in the week ending May 20th, up from 33% declines in late March. However, relative to the improvements in recent weeks, the latest foot traffic data exhibited the first WoW deceleration in the eight weeks since the pandemic began.
- While the states whose stay-at-home orders expired first continue to outperform, there are some notable exceptions, including Texas, Georgia, and Colorado, which are partly driving the resulting slowdown in foot traffic WoW performance.
- Texas’ relatively slower week appears due to a deceleration in what were fast-growing ‘essential’ sectors, such as Home Improvement, Grocers, and Big Box Stores. Interestingly, many of Texas’ metro areas are recovering at vastly different rates, with Austin improving at a much slower pace than its big sister Houston.
- States that reopened first outperformed in both in-store and online channels to varying degrees in Restaurants, Apparel, Home, and Hobbies & Toys. The only category in which the growth in early reopened states underperformed is in the Grocers & General Merchandise online channel, a reflection of continued lockdown behavior in the recently reopened states.
A Staggered Reopening
Nationally, spending growth* has improved from the 33% YoY declines in late March to 15% YoY declines as of last week. Looking at the top twenty states in the spend data, the states reviving the fastest include South Carolina, Tennessee, and Arizona; the slowest include D.C., Nevada, and Massachusetts. D.C. has yet to see any improvements, although the fact that it is primarily a work destination for neighboring residential areas may explain its continued consumer absence. Nevada’s over-representation in leisure may explain its slower performance as well.
Looking at the same analysis across all states with expired stay-at-home orders**, we looked at YoY performance subsequent to each state’s stay-at-home order expiration date in order to understand its potential impact on performance. (See next chart for the list of states with expired stay-at-home orders in descending order of YoY performance in the most recent week.)
Understandably, states whose stay-at-home order expired earlier are generally outperforming. However, there are some noteworthy exceptions: Texas, Georgia, and Colorado’s stay-at-home orders all expired before May 1st, yet they are not among the top performing states. Additionally, Nevada’s stay-at-home order officially expired on May 9th, yet it is among the slowest performing states, likely due to its heavy leisure exposure as mentioned above.
Foot Traffic Regression
In our foot traffic data, we saw similar improvements nationally, though the week ending May 16th showed the first WoW deceleration in eight weeks since the crisis began. Meanwhile, YoY foot traffic declines improved only modestly relative to prior weeks. We note that this activity is consistent with trends generally observed at the beginning of a month, which coincides with paycheck deposits. However, it is nevertheless interesting that cyclical behavior would begin to show this early within a long-term secular improvement trend.
While the vast majority of states saw their rate of improvement slow down in the most recent week, the national deceleration is being led by eight states who saw their YoY trends actually regress. Many of these states were among the earliest to reopen, including Texas and Colorado, or those that never had stay-at-home orders to begin with, including Arkansas, Nebraska, and Wyoming.
Texas Drill Down
Zooming in on one of the regressing states, Texas, the deceleration appears to be driven by a slowdown of some of the fast-growing essential sectors, notably Home Improvement, Grocers, and Big Box Stores. On the flip side, sectors that are reopening, like Beauty Supply and Department Stores, continue to improve.
Drilling further into Texas’ top 15 CBSAs, there’s a layered story of local disagreement around brick and mortar reopenings. Looking at Apparel and Department Stores specifically, after ~100% declines at trough, the larger cities (San Antonio, Dallas, Houston, Austin, Kileen, El Paso) have improved to ~60% to 70% YoY declines, underperforming the rest of the state’s ~50% or better. Among the largest cities, Austin and Houston are a full 12 percentage points apart; the former declining 69% and the latter declining 57%.
As we noted in Part 1 of our analysis, the states that reopened first generally outperformed the states that only recently reopened. This outperformance primarily manifested in brick and mortar spending at Restaurants, Home, just recently in Apparel, and to a large degree in Hobbies/Toys & Sporting Goods. In the online channel, outperformance was understandably more manifest in sectors most impacted by lockdown, primarily with Restaurants and Apparel, and briefly in Home.
There was minimal difference in channel spending among the two state groups in the ‘essential’ Grocers & General Merchandise categories, and in the virtually non-existent Leisure category. The only category in which the growth in early reopened states continues to underperform the growth in recently reopened states is in the Grocers & General Merchandise online channel, a reflection of continued lockdown behavior in the recently reopened states.
*This analysis shows total consumer spending as a measure of total sales observed in the panel. Our prior piece included a similar chart but was based on the total number of transactions [vs. sales] observed in the panel.
**Stay-at-home order expiration dates were sourced from this New York Times piece.
Appendix – list of merchants by category
Foot Traffic Data
Home Improvement: Ace Hardware, Carpet One, Floor & Decor, Home Depot, Lowe’s, Lumber Liquidators, Menards, Sears Hardware, Sherwin Williams, Tractor Supply, TrueValue
Big Box Stores: Big Lots, BJ’s Wholesale, Costco, Kmart, Meijer, Sam’s Club, Target, Walmart
QSR: A&W, Arby’s, Baskin Robbins, Blimpie, Bojangles’, Burger King, Captain D’s, Carl’s Jr, Checkers, Chick-fil-A, Church’s Chicken, Dairy Queen, Del Taco, Domino’s Pizza, El Pollo Loco, Fazoli’s, Five Guys, Green Burrito, Hardees, In-N-Out Burger, Jack in the Box, Jamba Juice, Jersey Mike’s Subs, KFC, Krispy Kreme, Krystal Burger, Long John Silvers, McDonald’s, Papa John’s, Popeyes Louisiana Kitchen, Quiznos, Raising Canes, Rallys, Schlotzskys, Sonic, Subway, Taco Bell, Taco Johns, Wendy’s, Whataburger, White Castle
Grocery: Acme Markets, Ahold Delhaize, Albertsons, Aldi, Big Y, BI-LO, Copps, Cub Foods, Dillons Food Stores, Farm Fresh, Fred Meyer, Fry’s, Giant Food Stores, Grocery Outlet, Hannaford, Harris Teeter, HEB, Hornbacher’s, Hy-Vee, Jewel Osco, King Soopers, Kroger, Mariano’s, Metro Market, Pathmark, Pick N Save, Piggly Wiggly, Price Chopper, Publix, Ralphs, Safeway, Save A Lot, Schnucks, Sendik’s, Shaws, Shop N Save, Shoppers Food and Pharmacy, Smart And Final, Sprouts, Sto pand Shop, Supervalu, Tops Friendly Markets, Trader Joe’s, Wakefern, Wegmans, Whole Foods, Winn-Dixie, Woodman’s Market
Pharmacies: CVS, Rite Aid, Walgreens
Beauty Supply: Sephora, Ulta Beauty
Department Stores: Barneys, Bloomingdale’s, Boscov’s, JCPenney, Kohl’s, Lord and Taylor, Macy’s, Neiman Marcus, Nordstrom, Nordstrom Rack, Saks Fifth Avenue, Saks Off Fifth, Sears
Apparel & Department Stores. Apparel: & Other Stories, Abercrombie, Adidas, Aerie, Aeropostale, Aldo, Alton Lane, Altra, America’s Best, American Eagle, Ann Taylor, Anthropologie, Aritzia, Ashley Stewart, Asics, Athleta, Babies ”R” Us, Balenciaga, Banana Republic, Bandier, Barclay Jewelers, Baskins, BCBG, Ben Bridge, Betteridge, BHLDN, Boot Barn, Brandy Melville, Brooks Brothers, Buckle, Burberry, BVLGARI, Calvin Klein, Canada Goose, Carter’s, Cartier, Casual Male XL, Catherines, Cato, Cavender’s, Champs, Chanel, Charlotte Russe, Charming Charlie, Chico’s, Chubbies Shorts, Citi Trends, Claire’s, Club Monaco, Coach, Cole Haan, Columbia Sportswear, Converse, Cos, Cotton On, Crocs, Dakota Watch, David Yurman, David’s Bridal, Deckers Generic, Destination XL, Dior, Dressbarn, Drysdales, DSW, Duluth Trading Company, Eddie Bauer, Express, Eyemart Express, Famous Footwear, Fashion to Figure, Ferragamo, Fila Outlet, Finish Line, Fit2Run, Foot Locker, Footaction, Forever 21, Fossil, Francesca’s, Free People, Gap, Generation Tux, Giorgio Armani, Goodwill, Gucci, GUESS, Gymboree, H&M, Hanes, Helzberg Diamonds, Hermes, Hollister, Hot Topic, Hugo Boss, Hurley, Icebreaker, Icing, Ilori, Intermix, It’s Fashion, Ivivva, J.Crew, J.Jill, JackRabbit, Jansport, Jared, Jimmy Choo, Jockey, Johnston & Murphy, Jos. A. Bank, Joseph Abboud, Journeys, Justice, K&G Fashion Superstore, Kate Spade, Kay Jewelers, Kendra Scott Design, Kipling, Kit and Ace, Kmart, L.L. Bean, Lane Bryant, Lee Jeans, Lenscrafters, Levi’s, Lids, Lilly Pulitzer, Littman Jewelers, Loft, London Jewelers, Lone Star Western & Casual, Louis Vuitton, Lucy Activewear, Lululemon, Madewell, Maidenform, Maurices, Men’s Wearhouse, Merrell, Michael Kors, Moncler, Nautica, New York & Company, Nike, NIQUEA.D, North Face, Oakley, Old Navy, Oliver Peoples, Omega, Pacific Sunwear, Pandora Jewelry, Patriot Outfitters, Payless ShoeSource, Pearle Vision, Prada, Puma, Rainbow, Rainbow Shops, Ralph Lauren, Ray Ban, Reebok, Reeds Jewelers, Rochester Clothing, Rothy’s, Rue21, Samsonite, Sanuk, Saucony, Savers, Scrubs, Sears Optical, Shinola, Shoe Carnival, Six:02, Skechers USA, Smartwool,Soma, SPANX, Spencer’s, Sterling Regional, Steve Madden, Stuart Weitzman,Suit Supply, Sunglass Hut, Superga, Swatch, Tailgate Clothing, Talbots, Target Optical, The Children’s Place, Tiffany & Co., Tilly’s, Timberland, Timex, Tommy Bahama, Tommy Hilfiger, TOMS, Torrid, Tory Burch, Tourbillon, Tourneau, True Religion, TUMI, U.S. Patriot Tactical, Ugg, Under Armour, Uniform Advantage, Uniqlo, Unique, Urban Outfitters, Value Village, Vans, Vera Bradley, Versace, Versona, VF Outlet, Victoria’s Secret, Visionworks, White House Black Market, Williamson-Dickie, Wood’s Boots, Zara USA, Zumiez. Department Stores: Bealls, Belk, Bergdorf Goodman, Bergner’s, Bloomingdale’s, Bon-Ton, Boston Store, Burlington Stores, Carson’s, Century 21, cusp, Dd’s Discounts, Dillard’s, Elder-Beerman, Goody’s, Herberger’s, J.C. Penney, Kohl’s, Last Call, Lord & Taylor, Macy’s, Marshalls, Neiman Marcus, Nordstrom Full Price, Nordstrom Off Price, Off/Aisle, Palais Royal, Peebles, Ross Stores, Saks Fifth Avenue, Saks Off 5th, Sears, Sierra Trading Post, Stage Stores, Stein Mart, T.J. Maxx, Younkers.
Grocers & General Merchandise. Grocers: Acme, Albertson’s, Aldi, Big Y, Central Market, Cumberland Farms, Dillons, Fairway Market, Food 4 Less, Food Lion, Fred Meyer, Fry’s, Giant Carlisle, Giant Eagle, Giant Landover, Grocery Outlet, Hannaford, Harris Teeter, HEB, Hy-Vee, Ingles Markets, Jewel-Osco, Key Food, King Kullen, King Soopers, Kroger, Lidl, Lowes Foods, Lucky’s Market, Mariano’s, Market Basket, Meijer, Price Chopper Supermarkets, Publix, QFC, Raley’s, Ralphs, Safeway, Save Mart Supermarkets, Schnucks, Shaws, ShopRite, Smart & Final, Smith’s, Sprouts Farmers Market, Stater Bros. Markets, Stop & Shop, The Fresh Market, Tom Thumb Supermarkets, Trader Joe’s, Vons, Wegmans, Weis Markets, Whole Foods Market, WinCo Foods, Winn-Dixie. General Merchandise: 99 Cents Only Stores, BJ’s Ex Fuel, Casey’s General Store, Circle K, Corner Store, Costco Ex Gas, CVS, CVS Copay, Dollar General, Dollar Tree, Duane Reade, Duane Reade Copay, Family Dollar, Holiday Station Stores, Murphy USA, Ollie’s Bargain Outlet, Rite Aid, Rite Aid Copay, Sam’s Club, Target, Walgreens, Walgreens Copay, Walmart.
Hobbies/Toys & Sporting Goods. Hobbies/Toys: A.C. Moore, Ben Franklin Crafts, BLICK Art Materials, Build-A-Bear Workshop, FAO Schwarz, Guitar Center, Hobby Lobby, Jerry’s Artarama, Jo-Ann Stores, Lovepop, Michaels Stores, Music & Arts, Pat Catan’s, Toys ”R” Us. Sporting Goods: Academy Sports & Outdoors, Bass Pro Shops, Big 5 Sporting Goods, Cabela’s, City Gear, Dick’s Sporting Goods, Field & Stream, Gander Outdoors, Golf Galaxy, Hibbett Sports, Modell’s Sporting Goods, REI Coop, Sportsman’s Warehouse.
Home. Home Furnishing: Aaron Brothers, American Signature, Arhaus, Art Van, Ashley Furniture, At Home, Bed Bath & Beyond, Big Lots, Bob’s Discount Furniture, Casper, CB2, Chef Central, Crate & Barrel, Gordmans, Havertys, HomeGoods, HomeSense, Kirkland’s, La-Z-Boy (LZB), Mattress Firm, Mitchell Gold + Bob Williams, Pier 1 Imports, Pottery Barn, Raymour & Flanigan, Rejuvenation, Restoration Hardware, Rooms To Go, Sleep Number, Sleep Train, Sleepy’s, Sur La Table, Tempur-Pedic, Terrain,The Container Store, The RoomPlace, The Sill, Tuesday Morning, Value City, Waterworks, Wayfair, West Elm, Williams-Sonoma, World Market. Home Improvement: Ace Hardware, All Around Landscape Supply, All Pro Horticulture, Allied Building Products, Alterra, American Builders, Angelo’s Supply, Aspen Valley Landscape, Atlantic Irrigation, Auto-Rain Supply, Bissett Nursery, Boston Irrigation Supply, C&C Sand and Stone, Central Pump and Supply, Comex, Cutting Edge, Do it Best, Fastenal, Floor & Decor, Green Resource, Harbor Freight Tools, Harmony Gardens, HD Supply, Home Decorators, Hydro-Scape Products, Kirkwood Material Supply, Landscape Express, Landscaper’s Choice, Leslie’s Swimming Pool Supplies, Lowe’s, Marshall Stone, Menards, Northwest Marble, Orchard Supply Hardware, Rural King, Shemin Nurseries, Sherwin Williams, SiteOne Landscape Supply, South Coast Supply, Southwood Valley Turf, Stanley Black & Decker, Stone Center, The Home Depot, Tractor Supply, TrueValue, Village Nurseries.
Restaurants: Applebee’s, Arby’s, Baja Fresh, BJ’s Restaurants, Blaze Pizza, Bojangles’, Bonefish Grill, Bubba Gump Shrimp, Buffalo Wild Wings, Burger King, California Pizza Kitchen, Carrabba’s Italian Grill, Cheddar’s Scratch Kitchen, Cheesecake Factory, Chick-fil-A, Chili’s, Chipotle, Chuck E. Cheese’s, Chuy’s, Cold Stone Creamery, Cracker Barrel, Culver’s, Dairy Queen, Del Frisco’s, Del Taco, Denny’s, Domino’s Pizza, Dunkin’ Brands, Dutch Bros. Coffee, El Pollo Loco, Firehouse Subs, Five Guys, Freddy’s Frozen Custard & Steakburgers, Golden Corral, Habit Restaurants, Hardee’s, Hooters, IHOP, In-N-Out Burger, Jack in the Box, Jason’s Deli, Jersey Mike’s Subs, KFC, Krispy Kreme, Little Caesars, LongHorn Steakhouse, Maggiano’s Little Italy, Marco’s Pizza, McAlister’s Deli, McDonald’s, Mellow Mushroom, Miller’s Ale House, MISSION BBQ, MOD Pizza, Moe’s Southwest Grill, Noodles, Olive Garden, Outback Steakhouse, P.F. Chang’s, Panda Express, Panera Bread, Papa John’s, Papa Murphy’s, Peet’s Coffee, Pizza Hut, Popeyes Louisiana Kitchen, Portillo’s, Potbelly, Pret A Manger, Qdoba, Raising Cane’s, Red Lobster, Red Robin, Ruby Tuesday, Ruth’s Chris, Schlotzsky’s, Shake Shack, Smashburger, Sonic Drive-In, Starbucks, Subway, sweetgreen, Taco Bell, Taco Cabana, Texas Roadhouse, TGI Fridays, Torchys, Twin Peaks, Waffle House, Wendy’s, Whataburger, Wingstop, Yard House, Zaxby’s, Zoe’s Kitchen.
Leisure: Acme Technologies, Adventure Island, Alamo Drafthouse Cinema, AMC, AMF, Animal Kingdom, Aquatica, Bowlero, Bowlmor, BrunswickZone, Busch Gardens, Carowinds, Castaway Bay, Cedar Point, Century Theatre, Cinemark, Darien Lake, Dave & Buster’s, Discovery Cove, Disney’s Hollywood Studios, Dorney Park, Epcot, Frontier City, Gilroy Gardens, Great America, Kings Dominion, Kings Island, Knotts Berry, Lucky Strike, Magic Kingdom, Main Event, Michigans Adventure, Pinstripes, Punch Bowl Social, Rave, Reading International, Regal Cinemas, Round One, San Diego Zoo, Schlitterbahn, Seaworld, Sesame Place, Six Flags, Six Flags Hurricane Harbor Concord, Tinseltown USA, Topgolf, Universal Studios, Valleyfair, Water Country, White Water Bay, Worlds of Fun.